The attack on the Prime Minister from foreign soil came during a university address by Gandhi, whose party says Modi uses his official trips abroad to lampoon the Opposition.

"Hatred, anger and violence and the politics of polarisation has raised its ugly head in India today," he said while speaking at the University of California, Berkeley.

Gandhi, 47, who arrived in the US yesterday on a two- week-long tour, spoke about his reflections on contemporary India and the path forward for the world's largest democracy.

He said violence and hatred "distract" people from the task at hand.

"Liberal journalists being shot, people being lynched because they are Dalits, Muslims killed on suspicion of eating beef, this is new in India and damages India very badly," Gandhi said, apparently referring to vigilante violence and the killing of activist-journalist Gauri Lankesh.

"The politics of hate divides and polarises India making millions of people feel that they have no future in their own country," he said, adding that in today's connected world, this is "extremely dangerous".

"It isolates people and makes them vulnerable to radical ideas," he said.

India's strength so far has been that it has made many achievements and these were all done peacefully. "What can destroy our momentum is the opposite energy," he said.

In his address, Gandhi criticised Prime Minister Modi's economic policies, accusing him of causing "tremendous damage" to India's economy with "reckless and dangerous" decisions like demonetisation and "hastily-applied" GST.

He said the November 8 demonetisation decision was taken without consulting the Chief Economic Advisor and Parliament, which caused tremendous damage to the economy.

"Ignoring India's tremendous institutional knowledge and taking such decisions is reckless and dangerous," he charged.

Gandhi also accused Prime Minister Modi of "massively opening up" space for terrorists in Jammu and Kashmir, leading to an increase in violence.

He said said the decision by Modi to have a political tie-up with the Peoples Democratic Party (PDP) was a "strategic mistake".

"The PDP was the instrument that brought Kashmiri youngsters into the political process. And the day Mr Narendra Modi made an alliance between the PDP and the BJP, it destroyed the PDP as an instrument that could bring youngsters into the political system.

"And the day he did that, he massively opened up space for terrorists in Kashmir and they came in. And you saw a massive increase in violence," Gandhi said.

On the economy front, Gandhi claimed the decline in economic growth today is leading to an upsurge of anger in the country.

Gandhi also accused the government of wiping out millions of small businesses by demonetisation.

"Millions of small businesses were simply wiped out as a result of the demonetisation, farmers and many who use cash were hit extremely hard. Agriculture is in deep distress and farmers suicides have skyrocketed across the country."

Finance Minister Arun Jaitley, however, had said the fallout of demonetisation was on predicted lines and the economy will benefit in medium and long term.

Jaitley's remarks came after the Reserve Bank of India said that 99 per cent of the demonetised currency came back into the system. Jaitley had also insisted that money getting deposited in banks does not mean that all of it is legitimate.

But Gandhi described demonetisation "a completely self- inflicted wound" that caused approximately 2 per cent loss of the GDP.

Commenting on the unemployment situation, he said 30,000 new youngsters were joining the job market every single day and the government was only creating 500 jobs a day.

"If we continue at the current rate, if India cannot give the millions of people entering the job market employment, anger will increase and it has the potential to derail what has been built so far. That would be catastrophic for India and the world beyond," Gandhi warned.

The Congress vice president said that the central challenge for the country today is creating jobs.

Noting that roughly 12 million young people join the Indian job market every year with nearly 90 per cent of them having a high school education or less, Gandhi said India, being a democratic country, cannot follow the Chinese model of coercion.

Alleging that currently all the attention in India is being paid to the top hundred companies, he said: "Everything is geared towards them, the banking systems are monopolised by them and the doors of government are always open to them."

"And laws are shaped by them," he said, adding that entrepreneurs running small and medium businesses are struggling to get bank loans.

India, he said, has triggered a massive process of human transformation.

The momentum is so powerful that India's failure is no longer an option, he said.